The holding company for the New Zealand Steel mill at Glenbrook, near Auckland, has posted a 26.7 percent drop in tax-paid earnings in the year to June 30, according to Companies Office records filed before shortly before Christmas.

Profit fell to $95.3 million from $126.4 million a year earlier, the bare bones accounts for Tasman Steel Holdings show. The company increased total sales by 3.8 per cent to $878.1 million in the 12 months to the end of June last year, but cost of sales rose 8.6 percent, resulting in a 28.7 percent drop in gross profit to $77.5 million.

That was despite an unexplained near halving of administration expenses to $24.9 million in the year under review, from $42.7 million in the previous year.

On a comprehensive income basis, the Tasman Steel business reported a loss of $49.5 million, compared with a profit of $73.1 million a year earlier, reflecting an actuarial revaluation of the company's pension fund that knocked $165.6 million off its previous value. The change is not a cash item.

The accounts also disclose a $1.1 million dividend payment to Australian parent Bluescope during the year, using accumulated funds.

NZ Steel chief executive Simon Linge could not be reached for comment by time of publication.

However, he told BusinessDesk last September he was chasing a "stretch target" to treble profits over the next five years, although that would be "challenged" by falling global steel prices.

Earnings from the New Zealand operation come mainly from fulfilling demand from the domestic market, with direct exports of unprocessed Taharoa ironsands a further significant revenue source.

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